Intrinsic value of Spark Therapeutics, Inc. - ONCE

Previous Close

$105.07

  Intrinsic Value

$3.27

stock screener

  Rating & Target

str. sell

-97%

Previous close

$105.07

 
Intrinsic value

$3.27

 
Up/down potential

-97%

 
Rating

str. sell

We calculate the intrinsic value of ONCE stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 4.0

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  60.00
  54.50
  49.55
  45.10
  41.09
  37.48
  34.23
  31.31
  28.68
  26.31
  24.18
  22.26
  20.53
  18.98
  17.58
  16.32
  15.19
  14.17
  13.26
  12.43
  11.69
  11.02
  10.42
  9.87
  9.39
  8.95
  8.55
  8.20
  7.88
  7.59
Revenue, $m
  104
  161
  240
  349
  492
  676
  908
  1,192
  1,534
  1,937
  2,406
  2,941
  3,545
  4,218
  4,959
  5,769
  6,645
  7,587
  8,593
  9,661
  10,790
  11,979
  13,226
  14,532
  15,897
  17,319
  18,801
  20,342
  21,945
  23,610
Variable operating expenses, $m
  2,333
  3,604
  5,390
  7,820
  11,033
  15,168
  20,360
  26,734
  34,400
  43,450
  53,955
  65,966
  79,511
  94,602
  111,235
  129,393
  149,050
  170,174
  192,731
  216,687
  242,011
  268,676
  296,662
  325,956
  356,554
  388,460
  421,687
  456,258
  492,204
  529,565
Fixed operating expenses, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  2,333
  3,604
  5,390
  7,820
  11,033
  15,168
  20,360
  26,734
  34,400
  43,450
  53,955
  65,966
  79,511
  94,602
  111,235
  129,393
  149,050
  170,174
  192,731
  216,687
  242,011
  268,676
  296,662
  325,956
  356,554
  388,460
  421,687
  456,258
  492,204
  529,565
Operating income, $m
  -2,229
  -3,443
  -5,150
  -7,472
  -10,541
  -14,492
  -19,452
  -25,542
  -32,867
  -41,513
  -51,550
  -63,025
  -75,966
  -90,384
  -106,276
  -123,624
  -142,405
  -162,587
  -184,139
  -207,026
  -231,221
  -256,697
  -283,435
  -311,423
  -340,657
  -371,141
  -402,886
  -435,916
  -470,259
  -505,955
EBITDA, $m
  -2,218
  -3,426
  -5,124
  -7,435
  -10,489
  -14,421
  -19,357
  -25,416
  -32,705
  -41,309
  -51,296
  -62,715
  -75,592
  -89,940
  -105,753
  -123,016
  -141,704
  -161,787
  -183,233
  -206,008
  -230,083
  -255,434
  -282,041
  -309,891
  -338,981
  -369,315
  -400,904
  -433,771
  -467,946
  -503,465
Interest expense (income), $m
  0
  3
  13
  28
  48
  76
  114
  162
  222
  296
  385
  489
  611
  750
  907
  1,082
  1,275
  1,486
  1,714
  1,958
  2,220
  2,498
  2,791
  3,100
  3,425
  3,764
  4,119
  4,489
  4,874
  5,275
  5,691
Earnings before tax, $m
  -2,232
  -3,456
  -5,177
  -7,520
  -10,618
  -14,606
  -19,614
  -25,764
  -33,162
  -41,898
  -52,039
  -63,636
  -76,716
  -91,292
  -107,358
  -124,900
  -143,891
  -164,301
  -186,097
  -209,246
  -233,718
  -259,488
  -286,535
  -314,848
  -344,421
  -375,259
  -407,375
  -440,790
  -475,534
  -511,646
Tax expense, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  -2,232
  -3,456
  -5,177
  -7,520
  -10,618
  -14,606
  -19,614
  -25,764
  -33,162
  -41,898
  -52,039
  -63,636
  -76,716
  -91,292
  -107,358
  -124,900
  -143,891
  -164,301
  -186,097
  -209,246
  -233,718
  -259,488
  -286,535
  -314,848
  -344,421
  -375,259
  -407,375
  -440,790
  -475,534
  -511,646

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  584
  903
  1,350
  1,959
  2,764
  3,799
  5,100
  6,696
  8,616
  10,883
  13,514
  16,523
  19,915
  23,695
  27,861
  32,410
  37,333
  42,624
  48,274
  54,274
  60,617
  67,296
  74,306
  81,643
  89,307
  97,299
  105,621
  114,280
  123,284
  132,642
Adjusted assets (=assets-cash), $m
  584
  903
  1,350
  1,959
  2,764
  3,799
  5,100
  6,696
  8,616
  10,883
  13,514
  16,523
  19,915
  23,695
  27,861
  32,410
  37,333
  42,624
  48,274
  54,274
  60,617
  67,296
  74,306
  81,643
  89,307
  97,299
  105,621
  114,280
  123,284
  132,642
Revenue / Adjusted assets
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
  0.178
Average production assets, $m
  127
  197
  294
  426
  602
  827
  1,110
  1,458
  1,876
  2,369
  2,942
  3,597
  4,335
  5,158
  6,065
  7,055
  8,127
  9,279
  10,509
  11,815
  13,196
  14,650
  16,176
  17,773
  19,442
  21,181
  22,993
  24,878
  26,838
  28,875
Working capital, $m
  5
  7
  11
  16
  23
  31
  42
  55
  71
  89
  111
  135
  163
  194
  228
  265
  306
  349
  395
  444
  496
  551
  608
  668
  731
  797
  865
  936
  1,009
  1,086
Total debt, $m
  239
  512
  895
  1,417
  2,106
  2,994
  4,108
  5,477
  7,122
  9,065
  11,320
  13,898
  16,805
  20,045
  23,615
  27,513
  31,732
  36,267
  41,109
  46,251
  51,687
  57,411
  63,418
  69,706
  76,274
  83,123
  90,255
  97,676
  105,392
  113,412
Total liabilities, $m
  501
  774
  1,157
  1,679
  2,368
  3,256
  4,370
  5,739
  7,384
  9,327
  11,582
  14,160
  17,067
  20,307
  23,877
  27,775
  31,994
  36,529
  41,371
  46,513
  51,949
  57,673
  63,680
  69,968
  76,536
  83,385
  90,517
  97,938
  105,654
  113,674
Total equity, $m
  84
  129
  193
  280
  395
  543
  729
  958
  1,232
  1,556
  1,933
  2,363
  2,848
  3,388
  3,984
  4,635
  5,339
  6,095
  6,903
  7,761
  8,668
  9,623
  10,626
  11,675
  12,771
  13,914
  15,104
  16,342
  17,630
  18,968
Total liabilities and equity, $m
  585
  903
  1,350
  1,959
  2,763
  3,799
  5,099
  6,697
  8,616
  10,883
  13,515
  16,523
  19,915
  23,695
  27,861
  32,410
  37,333
  42,624
  48,274
  54,274
  60,617
  67,296
  74,306
  81,643
  89,307
  97,299
  105,621
  114,280
  123,284
  132,642
Debt-to-equity ratio
  2.860
  3.960
  4.640
  5.060
  5.330
  5.510
  5.630
  5.720
  5.780
  5.820
  5.860
  5.880
  5.900
  5.920
  5.930
  5.940
  5.940
  5.950
  5.960
  5.960
  5.960
  5.970
  5.970
  5.970
  5.970
  5.970
  5.980
  5.980
  5.980
  5.980
Adjusted equity ratio
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143
  0.143

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -2,232
  -3,456
  -5,177
  -7,520
  -10,618
  -14,606
  -19,614
  -25,764
  -33,162
  -41,898
  -52,039
  -63,636
  -76,716
  -91,292
  -107,358
  -124,900
  -143,891
  -164,301
  -186,097
  -209,246
  -233,718
  -259,488
  -286,535
  -314,848
  -344,421
  -375,259
  -407,375
  -440,790
  -475,534
  -511,646
Depreciation, amort., depletion, $m
  11
  17
  25
  37
  52
  71
  96
  126
  162
  204
  254
  310
  374
  445
  523
  608
  701
  800
  906
  1,019
  1,138
  1,263
  1,394
  1,532
  1,676
  1,826
  1,982
  2,145
  2,314
  2,489
Funds from operations, $m
  -2,220
  -3,439
  -5,152
  -7,483
  -10,566
  -14,534
  -19,518
  -25,638
  -33,001
  -41,693
  -51,786
  -63,326
  -76,343
  -90,847
  -106,835
  -124,291
  -143,190
  -163,501
  -185,191
  -208,228
  -232,581
  -258,225
  -285,141
  -313,316
  -342,745
  -373,433
  -405,393
  -438,645
  -473,220
  -509,156
Change in working capital, $m
  2
  3
  4
  5
  7
  8
  11
  13
  16
  19
  22
  25
  28
  31
  34
  37
  40
  43
  46
  49
  52
  55
  57
  60
  63
  65
  68
  71
  74
  77
Cash from operations, $m
  -2,222
  -3,442
  -5,155
  -7,488
  -10,573
  -14,543
  -19,529
  -25,651
  -33,016
  -41,712
  -51,807
  -63,350
  -76,370
  -90,878
  -106,870
  -124,329
  -143,230
  -163,544
  -185,237
  -208,277
  -232,633
  -258,280
  -285,198
  -313,376
  -342,808
  -373,499
  -405,461
  -438,716
  -473,294
  -509,233
Maintenance CAPEX, $m
  -7
  -11
  -17
  -25
  -37
  -52
  -71
  -96
  -126
  -162
  -204
  -254
  -310
  -374
  -445
  -523
  -608
  -701
  -800
  -906
  -1,019
  -1,138
  -1,263
  -1,394
  -1,532
  -1,676
  -1,826
  -1,982
  -2,145
  -2,314
New CAPEX, $m
  -48
  -69
  -97
  -133
  -175
  -225
  -283
  -348
  -418
  -493
  -573
  -655
  -739
  -823
  -907
  -990
  -1,072
  -1,152
  -1,230
  -1,306
  -1,381
  -1,454
  -1,526
  -1,597
  -1,668
  -1,740
  -1,812
  -1,885
  -1,960
  -2,037
Cash from investing activities, $m
  -55
  -80
  -114
  -158
  -212
  -277
  -354
  -444
  -544
  -655
  -777
  -909
  -1,049
  -1,197
  -1,352
  -1,513
  -1,680
  -1,853
  -2,030
  -2,212
  -2,400
  -2,592
  -2,789
  -2,991
  -3,200
  -3,416
  -3,638
  -3,867
  -4,105
  -4,351
Free cash flow, $m
  -2,277
  -3,522
  -5,270
  -7,646
  -10,784
  -14,820
  -19,883
  -26,095
  -33,560
  -42,367
  -52,584
  -64,259
  -77,419
  -92,075
  -108,221
  -125,842
  -144,910
  -165,397
  -187,267
  -210,489
  -235,032
  -260,871
  -287,987
  -316,368
  -346,008
  -376,914
  -409,099
  -442,583
  -477,398
  -513,584
Issuance/(repayment) of debt, $m
  188
  273
  383
  522
  690
  888
  1,114
  1,368
  1,646
  1,943
  2,255
  2,578
  2,908
  3,239
  3,570
  3,898
  4,219
  4,534
  4,842
  5,142
  5,436
  5,724
  6,007
  6,288
  6,568
  6,849
  7,132
  7,421
  7,716
  8,020
Issuance/(repurchase) of shares, $m
  2,263
  3,502
  5,241
  7,607
  10,733
  14,754
  19,800
  25,992
  33,437
  42,222
  52,416
  64,066
  77,201
  91,832
  107,954
  125,550
  144,595
  165,057
  186,905
  210,104
  234,626
  260,443
  287,538
  315,897
  345,517
  376,402
  408,565
  442,028
  476,821
  512,984
Cash from financing (excl. dividends), $m  
  2,451
  3,775
  5,624
  8,129
  11,423
  15,642
  20,914
  27,360
  35,083
  44,165
  54,671
  66,644
  80,109
  95,071
  111,524
  129,448
  148,814
  169,591
  191,747
  215,246
  240,062
  266,167
  293,545
  322,185
  352,085
  383,251
  415,697
  449,449
  484,537
  521,004
Total cash flow (excl. dividends), $m
  174
  253
  355
  483
  638
  821
  1,031
  1,266
  1,523
  1,797
  2,086
  2,385
  2,690
  2,997
  3,303
  3,606
  3,904
  4,195
  4,480
  4,758
  5,029
  5,296
  5,558
  5,818
  6,077
  6,336
  6,599
  6,866
  7,139
  7,420
Retained Cash Flow (-), $m
  -2,263
  -3,502
  -5,241
  -7,607
  -10,733
  -14,754
  -19,800
  -25,992
  -33,437
  -42,222
  -52,416
  -64,066
  -77,201
  -91,832
  -107,954
  -125,550
  -144,595
  -165,057
  -186,905
  -210,104
  -234,626
  -260,443
  -287,538
  -315,897
  -345,517
  -376,402
  -408,565
  -442,028
  -476,821
  -512,984
Prev. year cash balance distribution, $m
  444
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
  -1,645
  -3,249
  -4,886
  -7,124
  -10,095
  -13,933
  -18,769
  -24,726
  -31,914
  -40,425
  -50,329
  -61,681
  -74,511
  -88,835
  -104,651
  -121,944
  -140,691
  -160,862
  -182,425
  -205,347
  -229,596
  -255,148
  -281,980
  -310,079
  -339,440
  -370,066
  -401,966
  -435,162
  -469,682
  -505,564
Discount rate, %
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
  -1,577
  -2,975
  -4,252
  -5,866
  -7,825
  -10,111
  -12,680
  -15,455
  -18,333
  -21,193
  -23,901
  -26,321
  -28,331
  -29,824
  -30,724
  -30,989
  -30,612
  -29,624
  -28,088
  -26,093
  -23,748
  -21,171
  -18,481
  -15,793
  -13,205
  -10,797
  -8,627
  -6,733
  -5,127
  -3,807
Current shareholders' claim on cash, %
  15.6
  2.5
  0.4
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Spark Therapeutics, Inc. is a gene therapy company. The Company focuses on treating orphan diseases. It has a pipeline of product candidates targeting multiple rare blinding conditions, hematologic disorders and neurodegenerative diseases. Its pipeline includes a product candidate targeting choroideremia (CHM), which is in a Phase I/II clinical trial and a product candidate for hemophilia A, which is in a Phase I/II clinical trial. Its product investigational candidate, voretigene neparvovec, is intended to treat a genetic blinding condition or inherited retinal disease (IRD). The programs targeting hematologic disorders include SPK-FIX, for which the lead product candidate, SPK-9001, is in a Phase I/II clinical trial for the treatment of hemophilia B, as well as SPK-FVIII for the treatment of hemophilia A. In its SPK-FVIII program for the treatment of hemophilia A, the Company has initiated a dose-escalating Phase I/II clinical trial for its lead product candidate, SPK-8011.

FINANCIAL RATIOS  of  Spark Therapeutics, Inc. (ONCE)

Valuation Ratios
P/E Ratio -22.9
Price to Sales 142.2
Price to Book 8.6
Price to Tangible Book
Price to Cash Flow -35.6
Price to Free Cash Flow -28.4
Growth Rates
Sales Growth Rate -9.1%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 300%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 0.6%
Total Debt to Equity 0.6%
Interest Coverage 0
Management Effectiveness
Return On Assets -35.2%
Ret/ On Assets - 3 Yr. Avg. -36%
Return On Total Capital -39.8%
Ret/ On T. Cap. - 3 Yr. Avg. -49.9%
Return On Equity -39.9%
Return On Equity - 3 Yr. Avg. -50%
Asset Turnover 0.1
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin -600%
EBITDA Margin - 3 Yr. Avg. -1068.2%
Operating Margin -630%
Oper. Margin - 3 Yr. Avg. -1081.2%
Pre-Tax Margin -620%
Pre-Tax Margin - 3 Yr. Avg. -1077.9%
Net Profit Margin -620%
Net Profit Margin - 3 Yr. Avg. -1077.9%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

ONCE stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the ONCE stock intrinsic value calculation we used $65 million for the last fiscal year's total revenue generated by Spark Therapeutics, Inc.. The default revenue input number comes from 0001 income statement of Spark Therapeutics, Inc.. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our ONCE stock valuation model: a) initial revenue growth rate of 60% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.3%, whose default value for ONCE is calculated based on our internal credit rating of Spark Therapeutics, Inc., is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Spark Therapeutics, Inc..
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of ONCE stock the variable cost ratio is equal to 2243.1%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for ONCE stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for Spark Therapeutics, Inc..

Corporate tax rate of 27% is the nominal tax rate for Spark Therapeutics, Inc.. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the ONCE stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for ONCE are equal to 122.3%.

Life of production assets of 11.6 years is the average useful life of capital assets used in Spark Therapeutics, Inc. operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for ONCE is equal to 4.6%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $496.513 million for Spark Therapeutics, Inc. - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 37.943 million for Spark Therapeutics, Inc. is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Spark Therapeutics, Inc. at the current share price and the inputted number of shares is $4.0 billion.

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